UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549

	FORM 10-Q

[X]	Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 2006 or

[ ]	Transition report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the transition period from               to

Commission File No. 0-13298

	MORGAN STANLEY CORNERSTONE FUND II L.P.

	(Exact name of registrant as specified in its charter)

          New York                              	      13-3212871
(State or other jurisdiction of                 	  (I.R.S. Employer
incorporation or organization)                 	  Identification No.)

Demeter Management Corporation
330 Madison Avenue, 8th Floor
New York, NY 						             10017
(Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code  (212) 905-2700

Dean Witter Cornerstone Fund II




(Former name, former address, and former fiscal year, if changed since
last report)


Indicate by check-mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

Yes    X        No


Indicate by check-mark whether the registrant is a large accelerated
filer, an accelerated filer, or a non-accelerated filer.  See definition
of ?accelerated filer and large accelerated filer? in Rule 12b-2 of the
Exchange Act.  (Check one):

Large accelerated filer___Accelerated filer___Non-accelerated filer _X__


Indicate by check-mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act).  Yes ___  No  X



	<page> <table> MORGAN STANLEY CORNERSTONE FUND II L.P.


(formerly, Dean Witter Cornerstone Fund II)

	INDEX TO QUARTERLY REPORT ON FORM 10-Q

	June 30, 2006

<caption>



PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

				<c>
		Statements of Financial Condition as of June 30, 2006
		(Unaudited) and December 31, 2005 ........................ 2

		Statements of Operations for the Three and Six Months
		Ended June 30, 2006 and 2005 	(Unaudited).................. 3

		Statements of Changes in Partners? Capital for the
		Six Months Ended June 30, 2006 and 2005 	(Unaudited)........4

		Statements of Cash Flows for the Six Months Ended
		June 30, 2006 and 2005 (Unaudited).........................5

		Notes to Financial Statements (Unaudited) ............. 6-11

Item 2.	Management?s Discussion and Analysis of
			Financial Condition and Results of Operations ..... 12-26

Item 3.	Quantitative and Qualitative Disclosures about
			Market Risk ....................................... 27-39

Item 4.	Controls and Procedures ...............................39


PART II. OTHER INFORMATION

Item 1A.Risk Factors...........................................40

Item 5.	Other Information...................................40-41

Item 6.	Exhibits...............................................41




</table>


<page> <table> PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

	MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
	STATEMENTS OF FINANCIAL CONDITION
<caption>
	June 30,	December 31,
	        2006        	        2005
	$	$
	(Unaudited)
ASSETS

	<c>	<c>
Equity in futures interests trading accounts:
	Unrestricted cash	9,643,901	11,242,503
	Restricted cash	        420,541	    1,213,808

	     Total cash	   10,064,442	   12,456,311

	Net unrealized gain on open contracts (MS&Co.)	43,210       	       344,900
	Net unrealized gain on open contracts (MSIL)	              ?     	       173,143

	     Total net unrealized gain on open contracts	         43,210	       518,043

	     Total Trading Equity	10,107,652	12,974,354

Interest receivable (Morgan Stanley DW)	                        33,753	        35,476
Due from Morgan Stanley DW	          25,348	         11,710

	     Total Assets	  10,166,753	 13,021,540

LIABILITIES AND PARTNERS' CAPITAL

Liabilities

Redemptions payable	133,213	333,219
Accrued management fees	        29,586	         37,886
Accrued administrative expenses	         22,827	         32,208

   	    Total Liabilities	      185,626	       403,313

Partners? Capital

Limited Partners (2,815.579 and
    3,261.160 Units, respectively)	9,663,425	12,240,749
General Partner (92.567 and
    100.567 Units, respectively)	     317,702	         377,478

	     Total Partners? Capital	   9,981,127	    12,618,227

	     Total Liabilities and Partners? Capital	   10,166,753	    13,021,540
NET ASSET VALUE PER UNIT	       3,432.13                             3,753.50
<fn>
	The accompanying notes are an integral part
	of these financial statements.
</table>
<page> <table> 	MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
	STATEMENTS OF OPERATIONS
(Unaudited)

<caption>

                           For the Three Months	                       For the Six Months
  	                  Ended June 30,     	                        Ended June 30,

                          2006   	        2005    	       2006   	    2005
                             $	               $	           $ 	 $

	                                 <c>	     <c>	<c>	<c>
INVESTMENT INCOME
	Interest income (Morgan Stanley DW)	   102,983		        81,066 		    209,393		           163,483

EXPENSES
	Brokerage commissions (Morgan Stanley DW)	167,425	202,047	345,157		445,753
	Management fees	      94,124	    122,392	 198,323		   260,957
	Common administrative expenses	        12,000	        10,000    	     23,000		        20,000
	Transaction fees and costs	        11,226	        14,928	      22,539		        30,627

		   Total Expenses 	    284,775	      349,367		    589,019	        757,337

NET INVESTMENT LOSS 	    (181,792)	     (268,301)	   (379,626)		     (593,854)

TRADING RESULTS
Trading profit (loss):
	Realized	 211,555	(522,534)	(172,394)		(1,980,111)
	Net change in unrealized	      20,422	        54,082 	    (474,833)		      (1,137,595)

	           Total Trading Results	    231,977	     (468,452)	   (647,227)		  (3,117,706)

NET INCOME (LOSS)	      50,185	     (736,753)	    (1,026,853)		    (3,711,560)

NET INCOME (LOSS) ALLOCATION

	Limited Partners	 48,045	  (717,964)	(995,941)		(3,617,711)
	General Partner 	                      2,140	(18,789)	(30,912)		(93,849)


NET INCOME (LOSS) PER UNIT

	Limited Partners                                                	7.29	            (186.83)	(321.37)	(933.19)
	General Partner                                                 	7.29               (186.83)	(321.37)	(933.19)



<fn>


	The accompanying notes are an integral part
	of these financial statements.
</table>
<page> <table> MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
	STATEMENTS OF CHANGES IN PARTNERS? CAPITAL
	For the Six Months Ended June 30, 2006 and 2005
	(Unaudited)

<caption>



			                                                         Units of
			                                                      Partnership	 Limited	     General
			                                                         Interest    	     Partners   	          Partner    	     Total
					$	      $	 $

			<c>	<c>	<c>	<c>
Partners? Capital,
   December 31, 2004	3,998.749	18,161,153	468,530	18,629,683

Net Loss	?	(3,617,711)	(93,849)	(3,711,560)

Redemptions	    (280.548)	    (1,065,264)	            ?     	    (1,065,264)

Partners? Capital,
   June 30, 2005	  3,718.201	 13,478,178	  374,681	 13,852,859





Partners? Capital,
   December 31, 2005	3,361.727	12,240,749	377,478	12,618,227

Net Loss	?	(995,941)	(30,912)	(1,026,853)

Redemptions	    (453.581)	   (1,581,383)	       (28,864)	    (1,610,247)

Partners? Capital,
   June 30, 2006	  2,908.146	 9,663,425	  317,702	 9,981,127





<fn>




The accompanying notes are an integral part
	of these financial statements.
</table>
<page> <table> 	MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
	STATEMENTS OF CASH FLOWS
(Unaudited)


<caption>


				   For the Six Months Ended June 30,

				            2006      	      2005
				     $	$

CASH FLOWS FROM OPERATING ACTIVITIES

			<c>	<c>
Net loss		(1,026,853)	(3,711,560)
Noncash item included in net loss:
	Net change in unrealized	474,833	1,137,595

(Increase) decrease in operating assets:
	Restricted cash	793,267	1,225,219
	Interest receivable (Morgan Stanley DW)	1,723	(1,003)
	Due from Morgan Stanley DW	(13,638)	7,970

Decrease in operating liabilities:
	Accrued management fees	           (8,300)	         (13,771)
	Accrued administrative expenses	           (9,381)	           (7,322)

Net cash provided by (used for) operating activities	        211,651	   (1,362,872)


CASH FLOWS FROM FINANCING ACTIVITIES

Cash paid for redemptions of Units	    (1,810,253)	     (995,948)

Net cash used for financing activities	    (1,810,253)	      (995,948)

Net decrease in unrestricted cash	(1,598,602)	(2,358,820)

Unrestricted cash at beginning of period	   11,242,503	   14,047,174

Unrestricted cash at end of period	    9,643,901	   11,688,354

<fn>





	The accompanying notes are an integral part
	of these financial statements.

</table>


<page> MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
NOTES TO FINANCIAL STATEMENTS
June 30, 2006
(Unaudited)

The unaudited financial statements contained herein include, in
the opinion of management, all adjustments necessary for a fair
presentation of the results of operations and financial condition
of Morgan Stanley Cornerstone Fund II L.P. (formerly known as Dean
Witter Cornerstone Fund II) (the ?Partnership?).  The financial
statements and condensed notes herein should be read in
conjunction with the Partnership's December 31, 2005 Annual Report
on Form 10-K.  Certain prior year amounts relating to cash
balances were reclassified on the Statements of Financial
Condition and the related Statements of Cash Flows to conform to
2006 presentation.  Such reclassifications have no impact on the
Partnership?s reported net income (loss).

1.  Organization
Morgan Stanley Cornerstone Fund II L.P. (formerly known as Dean
Witter Cornerstone Fund II) is a New York limited partnership
organized in 1983 to engage in the speculative trading of futures
contracts, options on futures contracts, and forward contracts on
foreign currencies and other commodity interests.  The Partnership
is one of the Morgan Stanley Cornerstone Funds, comprised of the
Partnership, Morgan Stanley Cornerstone Fund III L.P., and Morgan
Stanley Cornerstone Fund IV L.P..
<page> MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

Effective July 21, 2006 Dean Witter Cornerstone Fund II was
renamed to Morgan Stanley Cornerstone Fund II L.P.

The Partnership?s general partner is Demeter Management
Corporation (?Demeter?). The non-clearing commodity broker is
Morgan Stanley DW Inc. (?Morgan Stanley DW?).  The clearing
commodity brokers are Morgan Stanley & Co. Incorporated (?MS &
Co.?) and Morgan Stanley & Co. International Limited (?MSIL?).
Demeter, Morgan Stanley DW, MS & Co., and MSIL are wholly-owned
subsidiaries of Morgan Stanley.  The trading managers to the
Partnership are Northfield Trading L.P. and John W. Henry &
Company, Inc. (individually, a ?Trading Manager?, or
collectively, the ?Trading Managers?).

2.  Related Party Transactions
The Partnership's cash is on deposit with Morgan Stanley DW, MS &
Co., and MSIL in futures, forwards, and options trading accounts
to meet margin requirements as needed.  Monthly, Morgan Stanley DW
pays the Partnership interest income equal to 80% of its average
daily Net Assets at a rate equal to the average yield on 13-week
U.S. Treasury bills. The Partnership pays brokerage commissions to
Morgan Stanley DW.

<page> MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

3.  Financial Instruments
The Partnership trades futures contracts, options on futures
contracts, and forward contracts on foreign currencies and other
commodity interests.  Futures and forwards represent contracts for
delayed delivery of an instrument at a specified date and price.
Risk arises from changes in the value of these contracts and the
potential inability of counterparties to perform under the terms
of the contracts.  There are numerous factors which may
significantly influence the market value of these contracts,
including interest rate volatility.


The market value of exchange-traded contracts is based on the
settlement price quoted by the exchange on the day with respect
to which market value is being determined.  If an exchange-traded
contract could not have been liquidated on such day due to the
operation of daily limits or other rules of the exchange, the
settlement price shall be the settlement price on the first
subsequent day on which the contract could be liquidated.  The
market value of off-exchange-traded contracts is based on the
fair market value quoted by the counterparty.

The Partnership?s contracts are accounted for on a trade-date
basis and marked to market on a daily basis.  The Partnership
<page> MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

accounts for its derivative investments in accordance with the
provisions of Statement of Financial Accounting Standards No.
133, ?Accounting for Derivative Instruments and Hedging
Activities? (?SFAS No. 133?).  SFAS No. 133 defines a derivative
as a financial instrument or other contract that has all three of
the following characteristics:

1)	One or more underlying notional amounts or payment
provisions;
2)	Requires no initial net investment or a smaller initial net
investment than would be required relative to changes in
market factors;
3)	Terms require or permit net settlement.

Generally, derivatives include futures, forward, swaps or options
contracts, and other financial instruments with similar
characteristics such as caps, floors, and collars.

The net unrealized gains on open contracts, reported as a
component of ?Equity in futures interests trading accounts? on the
Statements of Financial Condition, and their longest contract
maturities were as follows:





<page> MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

                        Net Unrealized Gains
                         On Open Contracts                Longest Maturities

                Exchange-  Off-Exchange-             Exchange-  Off-Exchange-
Date             Traded      Traded        Total      Traded       Traded
                   $            $            $

Jun. 30, 2006	42,903	307	43,210	Dec. 2007	Sep. 2006
Dec. 31, 2005	239,383	278,660	518,043	Dec. 2006	Mar. 2006

The Partnership has credit risk associated with counterparty non-
performance.  As of the date of the financial statements, the
credit risk associated with the instruments in which the
Partnership trades is limited to the amounts reflected in the
Partnership's Statements of Financial Condition.



The Partnership also has credit risk because Morgan Stanley DW, MS
& Co., and MSIL act as the futures commission merchants or the
counterparties, with respect to most of the Partnership?s assets.
Exchange-traded futures, forward, and futures-styled options
contracts are marked to market on a daily basis, with variations
in value settled on a daily basis. Morgan Stanley DW, MS & Co.,
and MSIL, each as a futures commission merchant for the
Partnership?s exchange-traded futures, forward, and futures-styled
options contracts, are required, pursuant to regulations of the
Commodity Futures Trading Commission (?CFTC?), to segregate from
their own assets, and for the sole benefit of their commodity
customers, all funds held by them with respect to exchange-traded


<page> MORGAN STANLEY CORNERSTONE FUND II L.P.
(formerly, Dean Witter Cornerstone Fund II)
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)

futures, forward, and futures-styled options contracts, including
an amount equal to the net unrealized gains (losses) on all open
futures, forward, and futures-styled options contracts, which
funds, in the aggregate, totaled $10,107,345 and $12,695,694 at
June 30, 2006 and December 31, 2005, respectively. With respect
to the Partnership?s off-exchange-traded forward currency
contracts, there are no daily exchange-required settlements of
variation in value, nor is there any requirement that an amount
equal to the net unrealized gains (losses) on open forward
contracts be segregated.  However, the Partnership is required to
meet margin requirements equal to the net unrealized loss on open
contracts in the Partnership accounts with the counterparty, which
is accomplished by daily maintenance of the cash balance in a
custody account held at Morgan Stanley DW for the benefit of MS &
Co. With respect to those off-exchange-traded forward currency
contracts, the Partnership is at risk to the ability of MS & Co.,
the sole counterparty on all such contracts, to perform. The
Partnership has a netting agreement with MS & Co. This agreement,
which seeks to reduce both the Partnership?s and MS & Co.?s
exposure on off-exchange-traded forward currency contracts, should
materially decrease the Partnership?s credit risk in the event of
MS & Co.?s bankruptcy or insolvency.



<page> Item 2. MANAGEMENT?S DISCUSSION AND ANALYSIS OF FINANCIAL
        CONDITION AND RESULTS OF OPERATIONS

Liquidity.  The Partnership deposits its assets with Morgan
Stanley DW as non-clearing broker, and MS & Co. and MSIL as
clearing brokers in separate futures, forwards, and options
trading accounts established for each Trading Manager.  Such
assets are used as margin to engage in trading and may be used as
margin solely for the Partnership?s trading. The assets are held
in either non-interest bearing bank accounts or in securities and
instruments permitted by the CFTC for investment of customer
segregated or secured funds.  Since the Partnership?s sole purpose
is to trade in futures, forwards, and options, it is expected that
the Partnership will continue to own such liquid assets for margin
purposes.

The Partnership?s investment in futures, forwards, and options
may, from time to time, be illiquid.  Most U.S. futures exchanges
limit fluctuations in prices during a single day by regulations
referred to as ?daily price fluctuations limits? or ?daily
limits?.  Trades may not be executed at prices beyond the daily
limit.  If the price for a particular futures or options contract
has increased or decreased by an amount equal to the daily limit,
positions in that futures or options contract can neither be taken
nor liquidated unless traders are willing to effect trades at or
within the limit.  Futures prices have occasionally moved the
daily limit for several consecutive days with little or no
trading.  These market conditions could prevent the Partnership
<page> from promptly liquidating its futures or options contracts
and result in restrictions on redemptions.

There is no limitation on daily price moves in trading forward
contracts on foreign currencies.  The markets for some world
currencies have low trading volume and are illiquid, which may
prevent the Partnership from trading in potentially profitable
markets or prevent the Partnership from promptly liquidating
unfavorable positions in such markets, subjecting it to
substantial losses.  Either of these market conditions could
result in restrictions on redemptions.  For the periods covered by
this report, illiquidity has not materially affected the
Partnership?s assets.

There are no known material trends, demands, commitments, events,
or uncertainties at the present time that are reasonably likely to
result in the Partnership?s liquidity increasing or decreasing in
any material way.

Capital Resources.  The Partnership does not have, nor expects to
have, any capital assets.  Redemptions of units of limited
partnership interest (?Unit(s)?) in the future will affect the
amount of funds available for investments in futures, forwards,
and options in subsequent periods. It is not possible to estimate
the amount, and therefore the impact, of future outflows of Units.

<page> There are no known material trends, favorable or
unfavorable, that would affect, nor any expected material changes
to, the Partnership?s capital resource arrangements at the present
time.

Off-Balance Sheet Arrangements and Contractual Obligations.  The
Partnership does not have any off-balance sheet arrangements, nor
does it have contractual obligations or commercial commitments to
make future payments that would affect its liquidity or capital
resources.

Results of Operations
General.  The Partnership?s results depend on the Trading Managers
and the ability of each Trading Manager?s trading program(s) to
take advantage of price movements in the futures, forwards, and
options markets.  The following presents a summary of the
Partnership?s operations for the three and six month periods ended
June 30, 2006 and 2005, and a general discussion of its trading
activities during each period.  It is important to note, however,
that the Trading Managers trade in various markets at different
times and that prior activity in a particular market does not mean
that such market will be actively traded by the Trading Managers
or will be profitable in the future. Consequently, the results of
operations of the Partnership are difficult to discuss other than
in the context of the Trading Managers? trading activities on
behalf of the Partnership during the period in question. Past
performance is no guarantee of future results.
<page> The Partnership?s results of operations set forth in the
financial statements on pages 2 through 11 of this report are
prepared in accordance with accounting principles generally
accepted in the United States of America, which require the use of
certain accounting policies that affect the amounts reported in
these financial statements, including the following:  The
contracts the Partnership trades are accounted for on a trade-date
basis and marked to market on a daily basis.  The difference
between their cost and market value is recorded on the Statements
of Operations as ?Net change in unrealized trading profit (loss)?
for open (unrealized) contracts, and recorded as ?Realized trading
profit (loss)? when open positions are closed out.  The sum of
these amounts constitutes the Partnership?s trading results.  The
market value of a futures contract is the settlement price on the
exchange on which that futures contract is traded on a particular
day. The value of foreign currency forward contracts is based on
the spot rate as of the close of business.  Interest income, as
well as management fees, incentive fees, brokerage commissions,
and transaction fees and costs of the Partnership are recorded on
an accrual basis.

Demeter believes that, based on the nature of the operations of
the Partnership, no assumptions relating to the application of
critical accounting policies other than those presently used
could reasonably affect reported amounts.


<page> For the Three and Six Months Ended June 30, 2006
The Partnership recorded total trading results including interest
income totaling $334,960 and expenses totaling $284,775, resulting
in net income of $50,185 for the three months ended June 30, 2006.
The Partnership?s net asset value per Unit increased from
$3,424.84 at March 31, 2006 to $3,432.13 at June 30, 2006.

The most significant trading gains of approximately 1.3% were
recorded in the global interest rate markets from short positions
in U.S. and European fixed-income investments as prices trended
lower. In the U.S. interest rate markets, prices declined in
April following the release of stronger-than-expected economic
data. Similarly in Europe, rising equity prices, strong economic
growth and concerns about rising oil prices pressured European
fixed-income futures prices lower. U.S fixed-income futures
prices continued to move lower into May amid higher-than-
forecasted manufacturing and construction data and a sixteenth
consecutive interest rate hike by the U.S. Federal Reserve. A
portion of the Partnership?s gains in the second quarter was
offset by losses of approximately 0.9% in the global equity index
market from long positions in U.S. and European stock index
futures as equity prices reversed lower during May and continued
falling into June. The weakness in the equity markets was
attributed to inflation fears and uncertainty regarding global
interest rate policies. Losses of approximately 0.6% were
incurred in the energy sector from short positions in natural gas
<page> futures as prices moved higher in April on fears of a
possible supply shortage. In June, newly established long
positions in natural gas futures recorded additional losses as
prices reversed higher on reports from the U.S. Department of
Energy showing higher domestic inventories and fears of a slowing
global economy. Smaller losses of approximately 0.2% were
recorded in the currency sector from short positions in the
Japanese yen and Australian dollar relative to the U.S. dollar as
the U.S. dollar weakened in April on news that foreign central
banks, including Russia, Sweden and several Middle Eastern
central banks, were diversifying their currency reserves away
from the U.S. dollar. Also pressuring the value of the U.S.
dollar lower were concerns over the steep U.S. trade deficit and
speculation that the U.S. Federal Reserve may be near the end of
its interest rate tightening campaign. In addition to the U.S.
dollar weakening, the Japanese yen strengthened on speculation of
a possible Bank of Japan interest rate hike, while the Australian
dollar moved higher on an unexpected interest rate hike by the
Reserve Bank of Australia in May. Additional losses were incurred
from long positions in the British pound relative to the U.S
dollar as the U.S. dollar reversed higher in June after hawkish
comments from several U.S. Federal Reserve officials, including
U.S. Federal Reserve Chairman Ben Bernanke, implied another
interest rate hike was necessary to help contain rising
inflation. The value of the U.S. dollar continued to move higher
<page> leading up to the seventeenth consecutive interest rate
hike by the U.S. Federal Reserve on June 29th. Conversely, the
value of the British pound declined further against its major
rivals on economic data showing the unemployment rate in the
United Kingdom at its highest level since September 2002.


The Partnership recorded total trading results including interest
income totaling $(437,834) and expenses totaling $589,019,
resulting in a net loss of $1,026,853 for the six months ended
June 30, 2006.  The Partnership?s net asset value per Unit
decreased from $3,753.50 at December 31, 2005 to $3,432.13 at
June 30, 2006.

The most significant trading losses of approximately 9.8% were
experienced in the currency markets from long U.S. dollar
positions versus the Japanese yen and Australian dollar. During
April and May, the U.S. dollar moved lower on news that foreign
central banks are beginning to diversify their currency reserves
away from U.S. dollar-denominated assets, as well as uncertainty
regarding the future of the U.S. Federal Reserve?s interest rate
tightening campaign. The Japanese yen moved higher against the
U.S. dollar during January and February as strong economic data
out of the region increased speculation that the Bank of Japan
will raise interest rates. During April, the Japanese yen
strengthened on speculation of a possible Bank of Japan interest
rate hike, while the Australian dollar moved higher on an
<page> unexpected interest rate hike by the Reserve Bank of
Australia in May. Losses of approximately 3.2% were experienced
in the energy sector during February from long futures positions
in crude oil and its related products as prices declined after
Chinese government authorities announced that China would place
an emphasis on prospecting alternative energy sources in the
future, reports of larger-than-expected supplies from the
International Energy Agency, and mild weather in the U.S.
Northeast.  Additional losses in the energy sector were recorded
during March from short futures positions in the aforementioned
products as prices strengthened early in the month on supply
fears fueled by news of geopolitical tensions in Nigeria and
Iran. Further losses were incurred from long futures positions in
crude oil and its related products in May and June as prices
declined on reports of domestic inventory levels at eight-year
highs, the news of the death of Iraqi insurgent leader Abu Musab
al-Zarqawi, and positive steps taken regarding the nuclear
standoff between the U.S. and Iran. Smaller losses, approximately
0.5%, were recorded in the global stock index sector from long
positions in U.S. and Japanese equity index futures. During
February, Japanese equity markets moved lower on uncertainty
regarding the future of the interest rate policy of the Bank of
Japan. Additional losses in the global stock index futures
markets were recorded during March from long positions in S&P 500
Index futures as prices moved lower early in the month amid
disappointing readings of U.S. housing, consumer confidence, and
the Chicago purchasing managers index data. U.S. equity markets
<page> further weakened in May on inflation fears and uncertainty
regarding global interest rate policy. A portion of the
Partnership?s losses in the first six months of the year was
partially offset by gains of approximately 2.6% experienced in
the metals markets, primarily during January, from long futures
positions in copper, aluminum, zinc, and nickel as prices
strengthened amid news of weak supplies, forecasts for continued
buying by China, and acceleration in demand from Japan, Europe
and the U.S.  Elsewhere in the metals markets, gains were
recorded from long futures positions in silver and gold as
precious metals prices moved higher in January on persistent
demand from foreign central banks. Gains of approximately 1.3%
were recorded in the global interest rate sector from short
positions in U.S. and European fixed-income investments as prices
trended lower throughout April. In the U.S. markets, prices
declined following the release of stronger-than-expected economic
data. Similarly in Europe, rising equity prices and strong
economic growth pressured European fixed-income futures prices
lower. U.S fixed-income futures prices continued to move lower
into May amid higher-than-forecasted manufacturing and
construction data and a sixteenth consecutive interest rate hike
by the U.S. Federal Reserve. Smaller gains of approximately 0.1%
were experienced in the agricultural markets from long positions
in sugar futures as prices trended higher during January, moving
to their highest level since 1981 in response to a decline in
inventories, as well as increased ethanol demand.

<page>
For the Three and Six Months Ended June 30, 2005
The Partnership recorded total trading results including interest
income totaling $(387,386) and expenses totaling $349,367,
resulting in a net loss of $736,753 for the three months ended
June 30, 2005.  The Partnership?s net asset value per Unit
decreased from $3,912.52 at March 31, 2005 to $3,725.69 at June
30, 2005.

The most significant trading losses of approximately 10.3% were
recorded in the energy sector primarily during April and June.
During April, long futures positions in crude oil and its related
products resulted in losses as prices reversed sharply lower
after U.S. government data pointed to greater refinery
production, slower demand growth forecasts, and news of growing
supplies.  Elsewhere in the energy markets, losses resulted from
long natural gas positions as prices declined with crude oil
prices.  During June, losses were recorded from positions in
natural gas, crude oil, and its related products as short futures
positions held early in the month resulted in losses as prices
strengthened on supply-related concerns.  Later in June, long
crude oil futures positions experienced losses after prices
declined amid reports of slowing demand from China and reduced
concerns for U.S. supply disruptions.  News of negligible
production interruptions from the Gulf of Mexico caused natural
gas prices to rise, thus resulting in losses for short positions.
Additional losses of approximately 2.9% were incurred in the
<page> metals markets during April and May from long futures
positions in base and precious metals as prices fell due to news
of increased supply, fears of weak demand due to slower economic
growth, and strength in the U.S. dollar.  Losses during June
resulted from long futures positions in base metals, such as
copper and nickel, as prices weakened in response to rumors of
reduced demand from China.  Short futures positions in precious
metals also incurred losses after prices reversed higher at mid-
month as demand increased in response to temporary U.S. dollar
weakness.  In the global stock indices, losses of approximately
2.1% were recorded primarily during April from long positions in
Pacific Rim and European stock index futures as prices declined
amid concerns for global economic growth and higher oil prices.
Losses of approximately 1.9% experienced in the agricultural
markets stemmed primarily from positions in corn.  During April,
long futures positions in corn experienced losses after prices
fell amid favorable weather in U.S. growing regions.  Losses
incurred during May stemmed from short positions after corn
prices increased due to weather-related concerns.  Losses were
also recorded during June from long futures positions in corn as
prices dropped amid expectations of greater crop yields.  A
portion of the Partnership?s overall losses for the quarter was
offset by gains of approximately 10.1% in the currency markets
achieved primarily during May and June from short positions in
the euro, Japanese yen, and Swiss franc versus the U.S. dollar as
the U.S. dollar?s value increased after China downplayed rumors
of a move toward a flexible exchange rate.  Later in the month,
<page> the euro?s value declined further on weaker-than-expected
French economic news, while below-consensus Japanese economic
data pushed the yen?s value lower.  Gains were also experienced
during May from long positions in the Mexican peso and Brazilian
real versus the U.S. dollar as the values of these currencies
moved higher after Mexico?s Central Bank representatives declined
to change Mexico?s monetary policy and Brazil?s Minister of
Finance reported increased foreign investment in Brazil.  Short
positions in the euro, as well as the Japanese yen, benefited
during June as euro weakness resulted from market pessimism for
the future of Europe?s integration while weakness in the yen,
stemmed from data indicating economic weakness.  Additional gains
of approximately 3.3% were recorded in the global interest rate
markets primarily during May from long positions in European
interest rate futures as fixed income prices trended higher amid
greater demand for safe-haven investments due to uncertainty
regarding significant hedge fund trading losses, European Central
Bank rejections for increases in European interest rates, and
concerns for Europe?s integration process.

The Partnership recorded total trading results including interest
income totaling $(2,954,223) and expenses totaling $757,337,
resulting in a net loss of $3,711,560 for the six months ended
June 30, 2005.  The Partnership?s net asset value per Unit
decreased from $4,658.88 at December 31, 2004 to $3,725.69 at June
30, 2005.

<page> The most significant trading losses of approximately 8.9%
were experienced in the currency markets primarily during the
first quarter.  During January, long positions in a variety of
foreign currencies, primarily the South African rand, Swiss
franc, euro, and Singapore dollar, recorded losses after the U.S.
dollar?s value reversed higher amid positive U.S. economic data
and speculation for higher U.S. interest rates.  During February,
long positions in the Singapore dollar against the U.S. dollar
experienced losses as the U.S. dollar?s value rose in response to
positive sentiment for the Bush Administration?s budget proposal.
Relaxed speculation that China would re-value its currency
following the Group of Seven (?G-7?) countries? meetings also
boosted the U.S. dollar.  The G-7 countries consist of France,
the U.S., Britain, Germany, Japan, Italy and Canada.  Additional
losses were recorded from newly-established short positions in
the Singapore dollar, as well as from existing short positions in
the South African rand, Swiss franc, and euro, against the U.S.
dollar as the U.S. dollar weakened due to U.S. Current-Account
deficit concerns.  In early March, short European currency
positions resulted in losses as their values moved higher amid a
sharp rise in German industrial production.  Additional losses
were recorded from newly-established long euro positions, as well
as from existing long positions in the British pound and the
Singapore dollar, versus the U.S. dollar after the value of the
U.S. dollar reversed sharply higher amid an increase in U.S.
interest rates and consumer prices.  Additional Partnership
losses of approximately 6.6% established in the energy markets
<page> occurred during January, April, and June.  During January,
short futures positions in crude oil incurred losses after prices
increased amid speculation that OPEC would move to cut
production.  Forecasts for cold winter weather in the
Northeastern U.S. resulted in further losses.  Newly-established
long futures positions in crude oil experienced additional losses
after prices declined later during January on new rumors that
OPEC would not cut production, thereby increasing global supply.
Long futures positions in crude oil and its related products
continued to incur losses during April as prices reversed sharply
lower amid rising supplies and slower demand.  Additional losses
within the energy markets resulted from long natural gas
positions as prices declined with crude oil prices.  During June,
losses were recorded from futures positions in natural gas, crude
oil, and its related products as prices remained volatile due to
concerns regarding supply and demand.  Losses of approximately
4.2% resulted in the metals markets throughout the first and
second quarters from positions in both precious and base metals
as prices in the markets experienced choppiness amid volatility
in the value of the U.S. dollar and a negative outlook in demand.
Losses of approximately 1.6% incurred in the global stock indices
resulted primarily during April from long positions in Pacific
Rim and European stock index futures as equity prices declined
amid concerns for global economic growth and higher oil prices.
Losses of approximately 1.5% were recorded in the agricultural
markets during the second quarter from positions in corn futures.
During April, long futures positions in corn experienced losses
<page> after prices fell amid favorable weather in U.S. growing
regions. Losses incurred during May stemmed from short futures
positions in corn and long futures positions in cotton after corn
prices increased due to weather-related concerns.  Losses were
also recorded during June from long futures positions in corn and
cocoa after corn prices dropped amid expectations of greater crop
yields.  A portion of the Partnership?s overall losses was offset
by gains of approximately 0.5% achieved in the global interest
rate markets, largely during May, from long positions in European
interest rate futures as fixed income prices increased amid
greater demand for safe-haven investments amid uncertainty
regarding hedge fund trading, European Central Bank rejections
for increases in interest rates, and concerns for Europe?s
integration process.



<page> Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK

Introduction
The Partnership is a commodity pool engaged primarily in the
speculative trading of futures, forwards, and options.  The
market-sensitive instruments held by the Partnership are acquired
for speculative trading purposes only and, as a result, all or
substantially all of the Partnership?s assets are at risk of
trading loss.  Unlike an operating company, the risk of market-
sensitive instruments is inherent to the primary business activity
of the Partnership.

The futures, forwards, and options traded by the Partnership
involve varying degrees of related market risk.  Market risk is
often dependent upon changes in the level or volatility of
interest rates, exchange rates, and prices of financial
instruments and commodities, factors that result in frequent
changes in the fair value of the Partnership?s open positions,
and consequently in its earnings, whether realized or unrealized,
and cash flow.  Gains and losses on open positions of exchange-
traded futures, forwards, and options are settled daily through
variation margin.  Gains and losses on off-exchange-traded
forward currency contracts are settled upon termination of the
contract, however, the Partnership is required to meet margin
requirements equal to the net unrealized loss on open contracts
in the Partnership accounts with the counterparty, which is
accomplished by daily maintenance of the cash balance in a
<page> custody account held at Morgan Stanley DW for the benefit
of MS & Co.

The Partnership?s total market risk may increase or decrease as
it is influenced by a wide variety of factors, including, but not
limited to, the diversification among the Partnership?s open
positions, the volatility present within the markets, and the
liquidity of the markets.

The face value of the market sector instruments held by the
Partnership is typically many times the applicable margin
requirements.  Margin requirements generally range between 2% and
15% of contract face value.  Additionally, the use of leverage
causes the face value of the market sector instruments held by
the Partnership to typically be many times the total
capitalization of the Partnership.

The Partnership?s past performance is no guarantee of its future
results.  Any attempt to numerically quantify the Partnership?s
market risk is limited by the uncertainty of its speculative
trading.  The Partnership?s speculative trading and use of
leverage may cause future losses and volatility (i.e., ?risk of
ruin?) that far exceed the Partnership?s experiences to date
under the ?Partnership?s Value at Risk in Different Market
Sectors? section and significantly exceed the Value at Risk
(?VaR?) tables disclosed.

<page> Limited partners will not be liable for losses exceeding
the current net asset value of their investment.

Quantifying the Partnership?s Trading Value at Risk
The following quantitative disclosures regarding the Partnership?s
market risk exposures contain ?forward-looking statements? within
the meaning of the safe harbor from civil liability provided for
such statements by the Private Securities Litigation Reform Act of
1995 (set forth in Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934).  All
quantitative disclosures in this section are deemed to be forward-
looking statements for purposes of the safe harbor, except for
statements of historical fact.

The Partnership accounts for open positions on the basis of mark
to market accounting principles.  Any loss in the market value of
the Partnership?s open positions is directly reflected in the
Partnership?s earnings and cash flow.

The Partnership?s risk exposure in the market sectors traded by
the Trading Managers is estimated below in terms of VaR. The
Partnership estimates VaR using a model based upon historical
simulation (with a confidence level of 99%) which involves
constructing a distribution of hypothetical daily changes in the
value of a trading portfolio.  The VaR model takes into account
linear exposures to risk including equity and commodity prices,
interest rates, foreign exchange rates, and correlation among
<page> these variables. The hypothetical changes in portfolio
value are based on daily percentage changes observed in key market
indices or other market factors (?market risk factors?) to which
the portfolio is sensitive.  The one-day 99% confidence level of
the Partnership?s VaR corresponds to the negative change in
portfolio value that, based on observed market risk factors, would
have been exceeded once in 100 trading days, or one day in 100.
VaR typically does not represent the worst case outcome.
Demeter uses approximately four years of daily market data (1,000
observations) and re-values its portfolio (using delta-gamma
approximations) for each of the historical market moves that
occurred over this time period.  This generates a probability
distribution of daily ?simulated profit and loss? outcomes.  The
VaR is the appropriate percentile of this distribution.  For
example, the 99% one-day VaR would represent the 10th worst
outcome from Demeter?s simulated profit and loss series.

The Partnership?s VaR computations are based on the risk
representation of the underlying benchmark for each instrument or
contract and do not distinguish between exchange and non-exchange
dealer-based instruments. They are also not based on exchange
and/or dealer-based maintenance margin requirements.

VaR models, including the Partnership?s, are continually evolving
as trading portfolios become more diverse and modeling techniques
and systems capabilities improve.  Please note that the VaR model
is used to numerically quantify market risk for historic <page>
reporting purposes only and is not utilized by either Demeter or
the Trading Managers in their daily risk management activities.
Please further note that VaR as described above may not be
comparable to similarly-titled measures used by other entities.

The Partnership?s Value at Risk in Different Market Sectors
The following table indicates the VaR associated with the
Partnership?s open positions as a percentage of total Net Assets
by primary market risk category at June 30, 2006 and 2005.  At
June 30, 2006 and 2005, the Partnership?s total capitalization
was approximately $10 million and $14 million, respectively.

Primary Market		        June 30, 2006        June 30, 2005
Risk Category       	   Value at Risk        Value at Risk

Currency                        (1.54)% 	             (3.31)%
Interest Rate                   (1.00)	               (1.15)
Equity 	(0.14)	         (1.15)
Commodity                       (0.31)       	        (2.58)
Aggregate Value at Risk         (1.93)%              (4.49)%

The VaR for a market category represents the one-day downside
risk for the aggregate exposures associated with this market
category.  The Aggregate Value at Risk listed above represents
the VaR of the Partnership?s open positions across all the market
categories, and is less than the sum of the VaRs for all such
market categories due to the diversification benefit across asset
classes.
<page> Because the business of the Partnership is the speculative
trading of futures, forwards, and options, the composition of its
trading portfolio can change significantly over any given time
period, or even within a single trading day, which could
positively or negatively materially impact market risk as
measured by VaR.

The table below supplements the quarter-end VaR set forth above
by presenting the Partnership?s high, low, and average VaR, as a
percentage of total Net Assets for the four quarter-end reporting
periods from July 1, 2005 through June 30, 2006.

Primary Market Risk Category	High	   Low	     Average
Currency	(2.03)%	(1.22)%	(1.63)%

Interest Rate	(1.25)	(0.33)	(0.75)

Equity	(1.48)	(0.14)	(0.96)

Commodity	(2.07)	(0.23)	(0.92)


Aggregate Value at Risk	(3.16)%	(1.93)%	(2.49)%


Limitations on Value at Risk as an Assessment of Market Risk
VaR models permit estimation of a portfolio?s aggregate market
risk exposure, incorporating a range of varied market risks;
reflect risk reduction due to portfolio diversification or hedging
activities; and can cover a wide range of portfolio assets.
However, VaR risk measures should be viewed in light of the
methodology?s limitations, which include, but may not be limited
to the following:
<page>
*	past changes in market risk factors will not always result in
accurate predictions of the distributions and correlations of
future market movements;
*	changes in portfolio value caused by market movements may
differ from those of the VaR model;
*	VaR results reflect past market fluctuations applied to current
trading positions while future risk depends on future
positions;
*	VaR using a one-day time horizon does not fully capture the
market risk of positions that cannot be liquidated or hedged
within one day; and
*	the historical market risk factor data used for VaR estimation
may provide only limited insight into losses that could be
incurred under certain unusual market movements.

In addition, the VaR tables above, as well as the past performance
of the Partnership, give no indication of the Partnership?s
potential ?risk of ruin?.

The VaR tables provided present the results of the Partnership?s
VaR for each of the Partnership?s market risk exposures and on an
aggregate basis at June 30, 2005, and for the four quarter-end
reporting periods from July 1, 2005 through July 30, 2006.  VaR is
not necessarily representative of the Partnership?s historic risk,
nor should it be used to predict the Partnership?s future
<page> financial performance or its ability to manage or monitor
risk.  There can be no assurance that the Partnership?s actual
losses on a particular day will not exceed the VaR amounts
indicated above or that such losses will not occur more than once
in 100 trading days.

Non-Trading Risk
The Partnership has non-trading market risk on its foreign cash
balances.  These balances and any market risk they may represent
are immaterial.

The Partnership also maintains a substantial portion of its
available assets in cash at Morgan Stanley DW; as of June 30,
2006, such amount is equal to approximately 100% of the
Partnership?s net asset value.  A decline in short-term interest
rates would result in a decline in the Partnership?s cash
management income. This cash flow risk is not considered to be
material.

Materiality, as used throughout this section, is based on an
assessment of reasonably possible market movements and any
associated potential losses, taking into account the leverage,
optionality, and multiplier features of the Partnership?s market-
sensitive instruments, in relation to the Partnership?s Net
Assets.


<page>
Qualitative Disclosures Regarding Primary Trading Risk Exposures
The following qualitative disclosures regarding the Partnership?s
market risk exposures - except for (A) those disclosures that are
statements of historical fact and (B) the descriptions of how the
Partnership manages its primary market risk exposures - constitute
forward-looking statements within the meaning of Section 27A of
the Securities Act and Section 21E of the Securities Exchange Act.
The Partnership?s primary market risk exposures, as well as the
strategies used and to be used by Demeter and the Trading Managers
for managing such exposures, are subject to numerous
uncertainties, contingencies and risks, any one of which could
cause the actual results of the Partnership?s risk controls to
differ materially from the objectives of such strategies.
Government interventions, defaults and expropriations, illiquid
markets, the emergence of dominant fundamental factors, political
upheavals, changes in historical price relationships, an influx of
new market participants, increased regulation, and many other
factors could result in material losses, as well as in material
changes to the risk exposures and the risk management strategies
of the Partnership.  Investors must be prepared to lose all or
substantially all of their investment in the Partnership.

The following were the primary trading risk exposures of the
Partnership at June 30, 2006, by market sector.  It may be
anticipated, however, that these market exposures will vary
materially over time.
<page>
Currency.  The largest market exposure of the Partnership at June
30, 2006 was to the currency sector.  The Partnership?s currency
exposure is to exchange rate fluctuations, primarily fluctuations
which disrupt the historical pricing relationships between
different currencies and currency pairs.  Interest rate changes,
as well as political and general economic conditions influence
these fluctuations. The Partnership?s primary exposure at June 30,
2006 was to outright U.S. dollar positions.  Outright positions
consist of the U.S. dollar vs. other currencies.  These other
currencies include major and minor currencies.  Demeter does not
anticipate that the risk associated with the Partnership?s
currency trades will change significantly in the future.

Interest Rate.  The second largest market exposure of the
Partnership at June 30, 2006 was to the global interest rate
sector.  Exposure was primarily spread across the U.S., European,
and Japanese interest rate sectors.  Interest rate movements
directly affect the price of the sovereign bond futures positions
held by the Partnership and indirectly affect the value of its
stock index and currency positions.  Interest rate movements in
one country, as well as relative interest rate movements between
countries, materially impact the Partnership?s profitability.  The
Partnership?s primary interest rate exposure is generally to
interest rate fluctuations in the U.S. and the other G-7
countries? interest rates.  Demeter anticipates that the G-7
countries? interest rates will remain the primary interest rate
<page> exposures of the Partnership for the foreseeable future.
The speculative futures positions held by the Partnership may
range from short to long-term instruments.  Consequently, changes
in short, medium, or long-term interest rates may have an effect
on the Partnership.

Equity.  At June 30, 2006, the Partnership had market exposure to
the global stock index sector, primarily to equity price risk in
the G-7 countries.  The stock index futures traded by the
Partnership are by law limited to futures on broadly-based
indices.  At June 30, 2006, the Partnership?s primary exposures
were to the S&P/MIB (Italy), S&P 500 (U.S.), NASDAQ 100 (U.S.),
FTSE 100 (United Kingdom), and TAIWAN (Taiwan) stock indices.  The
Partnership is primarily exposed to the risk of adverse price
trends or static markets in the U.S., European, and Asian stock
indices.  Static markets would not cause major market changes, but
would make it difficult for the Partnership to avoid trendless
price movements, resulting in numerous small losses.

Commodity.
Energy.  The third largest market exposure of the Partnership
at June 30, 2006 was to the energy sector.  The Partnership?s
primary energy exposure was to futures contracts in crude oil
and its related products, as well as natural gas.  Price
movements in these markets result from geopolitical
developments, particularly in the Middle East, as well as
weather patterns, and other economic fundamentals.
<page> Significant profits and losses, which have been
experienced in the past, are expected to continue to be
experienced in the future.  Natural gas has exhibited
volatility in price resulting from weather patterns and
supply and demand factors and will likely continue in this
choppy pattern.

Qualitative Disclosures Regarding Non-Trading Risk Exposure
The following was the only non-trading risk exposure of the
Partnership at June 30, 2006:

Foreign Currency Balances.  The Partnership?s primary foreign
currency balances at June 30, 2006 were in the euros, Hong
Kong dollars, Japanese yen, British pounds, and Canadian
dollars.  The Partnership controls the non-trading risk of
foreign currency balances by regularly converting them back
into U.S. dollars upon liquidation of their respective
positions.

Qualitative Disclosures Regarding Means of Managing Risk Exposure
The Partnership and the Trading Managers, separately, attempt to
manage the risk of the Partnership?s open positions in essentially
the same manner in all market categories traded. Demeter attempts
to manage market exposure by diversifying the Partnership?s assets
among different Trading Managers in a multi-manager Partnership,
each of whose strategies focus on different market sectors and
trading approaches, and by monitoring the performance of the
<page> Trading Managers daily. In addition, the Trading Managers
establish diversification guidelines, often set in terms of the
maximum margin to be committed to positions in any one market
sector or market-sensitive instrument.

Demeter monitors and controls the risk of the Partnership?s non-
trading instrument, cash.  Cash is the only Partnership investment
directed by Demeter, rather than the Trading Managers.

Item 4.	CONTROLS AND PROCEDURES
   (a)	As of the end of the period covered by this quarterly
report, the President and Chief Financial Officer of
Demeter, the general partner of the Partnership, have
evaluated the effectiveness of the Partnership?s
disclosure controls and procedures (as defined in Rules
13a-15(e) and 15d-15(e) of the Exchange Act), and have
judged such controls and procedures to be effective.

 (b)	There have been no material changes during the period
covered by this quarterly report in the Partnership?s
internal control over financial reporting (as defined in
Rules 13a-15(f) and 15d-15(f) of the Exchange Act) or in
other factors that could significantly affect these
controls subsequent to the date of their evaluation.



<page> PART II.  OTHER INFORMATION

Item 1A. RISK FACTORS
Information regarding risk factors appears in Item 2.
?Management?s Discussion and Analysis of Financial Condition and
Results of Operations? and Item 3.  ?Quantitative and Qualitative
Disclosures about Market Risk? of this Form 10-Q.  There have been
no other material changes from the risk factors previously
referenced in the Partnership?s Report on Form 10-K for the fiscal
year ended December 31, 2005 and the Partnership?s Report on Form
10-Q for the quarter ended March 31, 2006.

Item 5.  OTHER INFORMATION
Management.  In connection with the election of new directors to
the Board of Directors of Demeter, the following information
updates the disclosures in the Partnership?s Form 8-K filed on
March 27, 2006 and Form 8-K filed on April 5, 2006:

On May 11, 2006, the National Futures Association approved Mr.
Walter Davis, Mr. Michael McGrath, and Mr. Andrew Saperstein as
directors of Demeter.

On July 20, 2006, the National Futures Association approved Mr.
Walter Davis as an associated person of Demeter.

<page> Effective July 21, 2006, Dean Witter Cornerstone Fund II
was renamed to Morgan Stanley Cornerstone Fund II L.P.

Item 6.  EXHIBITS
31.01	Certification of President of Demeter Management
Corporation, the general partner of the Partnership,
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.02	Certification of Chief Financial Officer of Demeter
Management Corporation, the general partner of the
Partnership, pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.

32.01	Certification of President of Demeter Management
Corporation, the general partner of the Partnership,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.

32.02	Certification of Chief Financial Officer of Demeter
Management Corporation, the general partner of the
Partnership, pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.


























<page>








SIGNATURE



Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.




                        Morgan Stanley Cornerstone Fund II L.P.
                        (Registrant)

                        By: Demeter Management Corporation
                            (General Partner)

August 14, 2006         By: /s/ Kevin Perry
                                Kevin Perry
                                Chief Financial Officer



The General Partner which signed the above is the only party
authorized to act for the Registrant.  The Registrant has no
principal executive officer, principal financial officer,
controller, or principal accounting officer and has no Board of
Directors.











<page> 				 EXHIBIT 31.01
CERTIFICATIONS

I, Walter Davis, President of Demeter Management Corporation
(?Demeter?), the general partner of the registrant, Morgan Stanley
Cornerstone Fund II L.P., certify that:

1.	I have reviewed this quarterly report on Form 10-Q of the
registrant;

 2.	Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other
financial information included in this report, fairly present
in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this report;

4.	The registrant?s other certifying officer and I are responsible
for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-
15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the
registrant and have:

  a)	Designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed
under our supervision, to ensure that material information
relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those
entities, particularly during the period in which this
report is being prepared;

  b)	Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting
and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;

  c)Evaluated the effectiveness of the registrant?s disclosure
controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered
by this report based on such evaluation; and

<page>
  d)Disclosed in this report any change in the registrant?s
internal control over financial reporting that occurred
during the registrant?s most recent fiscal quarter (the
registrant?s fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably
likely to materially affect, the registrant?s internal
control over financial reporting; and

5. The registrant?s other certifying officer and I have disclosed,
based on our most recent evaluation of internal control over
financial reporting, to the registrant?s auditors and the
audit committee of Demeter?s board of directors (or persons
performing the equivalent functions):

  a)All significant deficiencies and material weaknesses in the
design or operation of internal control over financial
reporting which are reasonably likely to adversely affect
the registrant?s ability to record, process, summarize and
report financial information; and

  b)Any fraud, whether or not material, that involves management
or other employees who have a significant role in the
registrant?s internal control over financial reporting.





 Date:  August 14, 2006		 /s/	Walter Davis         ___
                               	Walter Davis
                            		President,
                            		Demeter Management Corporation,
					    		general partner of the registrant




<page>  		 			  EXHIBIT 31.02
CERTIFICATIONS

I, Kevin Perry, Chief Financial Officer of Demeter Management
Corporation (?Demeter?), the general partner of the registrant,
Morgan Stanley Cornerstone Fund II L.P., certify that:

1.	I have reviewed this quarterly report on Form 10-Q of the
registrant;

 2.	Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other
financial information included in this report, fairly present
in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this report;

4.	The registrant?s other certifying officer and I are responsible
for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-
15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the
registrant and have:

  a)	Designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed
under our supervision, to ensure that material information
relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those
entities, particularly during the period in which this
report is being prepared;

  b)	Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting
and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;

 c)	Evaluated the effectiveness of the registrant?s disclosure
controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
<page>
 d)	Disclosed in this report any change in the registrant?s
internal control over financial reporting that occurred
during the registrant?s most recent fiscal quarter (the
registrant?s fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably
likely to materially affect, the registrant?s internal
control over financial reporting; and

5. The registrant?s other certifying officer and I have disclosed,
based on our most recent evaluation of internal control over
financial reporting, to the registrant?s auditors and the
audit committee of Demeter?s board of directors (or persons
performing the equivalent functions):

   a)	All significant deficiencies and material weaknesses in the
design or operation of internal control over financial
reporting which are reasonably likely to adversely affect
the registrant?s ability to record, process, summarize and
report financial information; and

   b)	Any fraud, whether or not material, that involves management
or other employees who have a significant role in the
registrant?s internal control over financial reporting.






Date:  August 14, 2006 		 /s/	Kevin Perry
                           	 	Kevin Perry
                            		Chief Financial Officer,
                            		Demeter Management Corporation,
					    		general partner of the registrant















<page>

	EXHIBIT 32.01


CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002




In connection with the Quarterly Report of Morgan Stanley
Cornerstone Fund II L.P. (the ?Partnership?) on Form 10-Q for the
period ended June 30, 2006 as filed with the Securities and
Exchange Commission on the date hereof (the ?Report?), I, Walter
Davis, President, Demeter Management Corporation, the general
partner of the Partnership, certify, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, that, to the best of my knowledge:
(1)	The Report fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents,
in all material respects, the financial condition and
results of operations of the Partnership.






By: /s/ Walter Davis

Name:   Walter Davis
Title:  President

Date:   August 14, 2006


		<page>			EXHIBIT 32.02


CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002




In connection with the Quarterly Report of Morgan Stanley
Cornerstone Fund II L.P. (the ?Partnership?) on Form 10-Q for the
period ended June 30, 2006 as filed with the Securities and
Exchange Commission on the date hereof (the ?Report?), I, Kevin
Perry, Chief Financial Officer, Demeter Management Corporation,
the general partner of the Partnership, certify, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:
(1)	The Report fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents,
in all material respects, the financial condition and
results of operations of the Partnership.







By: /s/ Kevin Perry

Name:	   Kevin Perry
Title:  Chief Financial Officer

Date:	August 14, 2006











DEAN WITTER CORNERSTONE FUND II
NOTES TO FINANCIAL STATEMENTS (CONTINUED)